(i) scripps networks - sec...(i) scripps networks interactive january 5, 2015 ... 12/02/2014 15:32...

Scripps Networks Interactive, Inc. 312 Walnut Street, 18'h Floor Cincinnati, OH 45202

Mary E. Talbott Senior Vice President, Deputy General Counsel and Corporate Secretary

(I) scripps networks interactive

January 5, 2015

U.S. Securities and Exchange Commission Division of Corporation Finance Office of the Chief Counsel 1 00 F Street, NE Washington, DC 20549

RE: Scripps Networks Interactive, Inc.

Ladies and Gentlemen:

PHONE (513) 824-3251 FAX (513) 824-3393 E-MAIL [email protected]

On December 2, 2014, Scripps Networks Interactive, Inc. (the "Company") received via facsimile a letter dated November 17, 2014 from James McRitchie and Myra K. Young (together, the "Proponents") requesting that a proposal (the "Proposal") be included in the Company's proxy soliciting material for its 2015 annual meeting of shareholders. A copy of the Proponent's letter and the Proposal and a follow-up letter from TD Ameritrade faxed to the Company on December 17,2014 regarding the Class A Common Shares held by Mr. McRitchie and Ms. Young (the "TD Ameritrade Letter") are attached to this letter as Exhibit A. The Proponents have requested that Mr. John Chevedden act as their agent with respect to the Proposal.

The Proposal requests that the following resolution be put to a vote at the next annual meeting:

"Resolved: Shareholders hereby request that our Board of Directors initiate the appropriate process to amend our Company's articles of incorporation and/or bylaws to provide that director nominees shall be elected by the affirmative vote of the majority of votes cast at an annual meeting of shareholders, with a plurality vote standard retained for contested director elections, that is, when the number of director nominees exceeds the number of board seats."

The Company believes that, under Rule 14a-8(f) adopted under the Securities Exchange Act of 1934, as amended, the Proposal may be omitted from the Company's proxy soliciting material for its next annual meeting of shareholders because the Proponents are not the owner of "securities entitled to be voted on the Proposal at the meeting" as is required by Rule 14a-8(b)(1).

The Ameritrade Letter states that the Proponents have continuously held 50 shares of the Company's "common stock" (without indicating the class) in their TD Ameritrade account for at least thirteen months from the date of the TD Ameritrade Letter. The Company has two classes of capital shares outstanding: (i) Class A Common Shares, which are listed on the New York Stock Exchange; and (ii) Common Voting Shares, which are privately held and not traded. The Company maintains a record of the owners (record and beneficial) of the privately held Common Voting Shares, and the holders of substantially all of the Common Voting Shares have filed a Schedule 13 D with the Commission reporting their ownership of Common Voting Shares. The Proponents do not own any Common Voting Shares ofthe Company. Therefore, the reference in the Ameritrade Letter to "common stock" actually refers to Class A Common Shares, the publicly traded shares of the Company.

Rule 14a-8(b)(l) provides, among other things, that in order to be eligible to submit a proposal, a shareholder must hold "securities entitled to vote on the proposal at the meeting." Under Rule 14a-8(f), a company may exclude from its proxy materials a proposal submitted by a proponent who fails to satisfy Rule 14a-8(b)(l)'s eligibility.

The Company's Class A Common Shares have limited voting rights, which entitle the holders of Class A Common Shares to elect the greater of three or one-third of the directors of the Corporation to be elected from time to time. Paragraph 2 of Article Fourth of the Company's Amended and Restated Articles of Incorporation ("Articles"), a copy of which is attached hereto as Exhibit B, provides that except for such specific voting right, and except as otherwise required by the Ohio Revised Code:

"[T]he entire voting power shall be vested solely and exclusively in the holders of Common Voting Shares ... and the holders of ... Class A Common Shares shall have no voting power and shall not have the right to participate in any meeting of shareholders or to have notice thereof."

Given that the Proponents are holders of only Class A Common Shares and do not own any Common Voting Shares, the Company's Articles do not permit the Proponents to vote on the Proposal. Moreover, the Proposal is not a matter on which Ohio law would require a shareholder vote by the holders of Class A Common Shares. Accordingly, the Company may exclude the Proposal pursuant to Rule 14a-8(b). See SEC Division of Corporation Finance, Staff Legal Bulletin No. 14(CF), Question and Answer C.l.b (2001).

The Commission Staff has consistently concurred that a company may exclude from its proxy materials shareholder proposals submitted by proponents who do not hold the requisite class of stock entitled to vote on the proposal. In The E. W. Scripps Company, 2006 SEC No-Act. LEXIS 718 (December 4, 2006), the Staff granted no-action reliefto The E.W. Scripps Company with respect to a proposal requesting that the company's board of directors adopt a policy which would require the submission of a survey question regarding the compensation of executive officers to a shareholder's vote at each future annual meeting. Similar to the Company, The E.W. Scripps Company had two classes of voting stock outstanding: Class A Common Shares, which are listed for trading on the New York Stock Exchange, and Common Voting Shares, which are privately held. The proponent in The E. W Scripps Company owned Class A Common Shares and not Common Voting Shares. As provided in the company's charter documents and under Ohio law, Class A Common Shares would not have been entitled to vote on the proposal in the event the proposal was submitted to the vote of the company's stockholders. Accordingly, since the proponent did not own Common Voting Shares, the Staff concurred that the proposal was properly excluded under Rule 14a-8(b).

Similarly, in The New York Times Company, 2006 SEC No-Act. LEXIS 742 (December 18, 2006), the Staff granted no-action relief to The New York Times Company with respect to a proposal recommending that the board of directors undertake specific steps to reform the company's corporate governance, including that the board approve for submission to shareholders a declassification plan that would provide for equal voting rights for all of the company's shares. Similar to the Company, The New York Times Company had two classes of voting stock outstanding: Class A and Class B Common Stock. The proponent in The New York Times Company owned Class A Common Stock, which was not entitled to vote on the proposal, rather than Class B Common Stock, which was entitled to vote on the proposal. Accordingly, the Staff concurred that the proposal was properly excluded under Rule 14a-8(b ), as the proponent did not own securities entitled to be voted on the proposal.

Finally, in The Washington Post Company, 2004 SEC No-Act. LEXIS 907 (December 24, 2004), the Staff granted no-action relief to The Washington Post Company with respect to a proposal requesting that the board of directors take steps to select an independent director who had not previously served as an officer of the company as chairman of the board of directors of the Company. Again, similar to the Company, The Washington Post Company had two classes of voting stock outstanding: Class A and Class B Common Stock. The proponent in The Washington Post Company owned Class B Common Stock, rather than Class A Common Stock. According to the voting rights described in the company's charter documents, Class B Common Stock would not have been entitled to vote on the proposal in the event the proposal was submitted to the vote of the company's stockholders. Therefore, the Staff concurred that the proposal was properly excluded under Rule 14a-8(b) for failure to meet the ownership requirement.

Because the Proponents have not demonstrated that they hold Common Voting Shares entitled to vote on the subject matter of the Proposal, the Proponents have failed to meet the eligibility requirements to submit a shareholder proposal under Rule 14a-8(b). Therefore, the Company intends to omit the Proponents' proposal from its proxy materials and respectfully requests that the Staff confirm to the Company that it will not recommend enforcement action to the Commission if the Proponents ' proposal is so omitted.

Although the Company was not required under Rule 14a-8(f) to send the Proponents a notice of their failure to meet the eligibility requirements of Rule 14a-8(b) since the deficiency could not be remedied (that is, they are not now, and have not been, the holders of Common Voting Shares), as a courtesy, on January 2, 2015, the Company sent the Proponents a letter notifying them of their ineligibility to submit the Proposal due to their failure to satisfy the ownership requirements of Rule 14a-8(b ). A copy of the Company's letter to the Proponents is attached to this letter as Exhibit C.

The Company reserves the right, should it be necessary, to present additional reasons for omitting the Proposal. If the Staff does not concur with the Company's position, we would appreciate an opportunity to confer with the Staff concerning this matter prior to the issuance of a Rule 14a-8 response. The Proponents are requested to copy the undersigned on any response they may choose to make to the Staff.

A copy of this letter, together with the enclosures, is being mailed to the Proponents.

If you have any questions with respect to this letter, please contact the undersigned at the above number.

Sincerely,

Mary E. Talbott

Enclosures

c w/encl: Mr. James McRitchie and Ms. Myra K. Young Mr. John Chevedden

12/02/2014 15:32

Ms. Cynthia L. Gibson Corporate Secretary Scripps Networks Interactive, Inc. (SNf) 9721 Sherrill Boulevard Knoxville, TN 37932 PH: 865-694-2700 FX; 865-985-7778 FX: 865-985-7771

Dear Corporate Secretary:

November 17, 2014

PAGE 01/03

We are pleased to be shareholders in Scripps Networks Interactive, Inc. (SNI) and appreciate the company's leadership. However, we also believe our company has further unrealized potential that can be unlocked through low or no cost measures by making our corporate governance more competitive.

We are submitting a shareholder proposal for a vote at the next annual shareholder meeting. The proposal meets all Rule 14a-8 requirements, including the continuous ownership of the required stock value for over a year. We pledge to continue to hold stock until after the date of the next shareholder meeting. Our submitted format, with the shareholder-supplied emphasis, is intended to be used for definitive proxy publication.

This letter confirms that we are delegating John Chevedden to act as our agent regarding this Rule 14a-8 proposal, including its submission, negotiations and/or modification, and presentation at the forthcoming shareholder meeting. Please direct all future communications regarding our rule 14a-8 proposal to John Chevedden

to facilitate prompt communication. Please identify me as the proponent of the proposal exclusively.

Your consideration and the consideration of the Board of Directors is appreciated in responding to this proposal. Please acknowledge receipt of my proposal promptly by email to

Sincerely,

_), t\'\~,(b;~ November 17, 2014

James McRitchie Date

~~ November 17,2014

Myra K. Young Date

cc: Mary Talbott <[email protected]> Assistant Corporate Secretary John Chevedden

*** FISMA & OMB Memorandum M-07-16 ***




*** FISMA & OMB Memorandum M-07-16 *** *** FISMA & OMB Memorandum M-07-16 ***

12/~2/2~14 15:32 PAGE ~2/~3

[SNI: Rule 14a-8 Proposal, December 2, 2014] Proposal 4 - Directors to be Elected by Majority Vote

Resolved: Shareholders hereby request that our Board of Directors initiate the appropriate process to amend our Company's articles of incorporation and/or bylaws to provide that director nominees shall be elected by the affirmative vote of th.e majority of votes cast at an annual meeting of shareholders, with a plurality vote standard retained for contested director elections, that is, when t~e number of director nominees exceeds the number of board seats.

In order to provide shareholders a meaningful role in director elections, our Company's current director election standard should be changed from a plurality vote standard to a majority vote standard. The majority vote standard is the most appropriate voting standard for director elections whe.re only board nominated candidates are on the ballot.

This will establish a challenging vote standard for board nominees and will improve the performance of individual directors and the entire board. Under our Company's current voting system, a director nominee can be elected with as little as one yes-vote. A majority vote standard would require that a nominee receive a majority of the votes cast in order to be elected. More than 77% of the companies in the S&P 500 have adopted majority voting for uncontested elections. Our company has an opportunity to join the growing list of companies that have already adopted this standard.

Please vote to enhance shareholder value: Directors to be Elected by Majot'ity Vote- Proposal4


12/02/2014 15: 32 PAGE 03/03

Notes: James McRitchie and Myra K. Young. sponsored this proposaL

"Proposal4" is a placeholder for the proposal number assigned by the company in the final p:ro~ -

Please note that the title of the proposal is part of the proposal.

This proposal is believed to conform with StaffLegal Bulletin No. 14B (CF), September 15, 2004 including (emphasis added):

Accordingly, going forward, we believe that it would not be appropriate for companies to exclude supporting statement language and/or an entire proposal in reliance on rule 14a-8(I)(3) in the following circumstances:

• the company objects to factual assertions because they are not supported; • the company objects to factual assertions that, while not materially false or misleading,

may be disputed or countered; • the company objects to factual asse1tions because those assertions may be intetpreted by

shareholders in a manner that is unfavorable to the company, its directors, or its officers; and/or

• the company objects to statements because they represent the opinion of the shareholder proponent or a referenced source, but the statements are not identified specifically as such.

We believe that it is appropriate under rule 14a-8for companies to address these objections in their statem£nts of opposition.

See also: Sun Microsystems, Inc. (July 21, 2005).

Stock will be held until after the annual meeting and the proposal will be presented at the annual meeting. Please acknowledge this proposal promptly by email




_,., .. ~ .... 12/17/2014 20:58 PAGE 01/01

i1iJ Ameritrade

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Fa><# 1"'"":::. ... ~ lj-/?71 Fax# 12/04/2014

v~ .r .- q TS -"1 7., I - ·---·-----.... ·---------------

James McRitchie & Myra Young

Re: Your TD Amerrtrade Account Ending in

Dear James McRitchie & Myra Young,

Thank you for allowing me to assist you today. Pursuant to your request, this letter is to confirm that as of the date of this letter, Jame::J McRitchie and Myra K. Young held, and had held continuously for at least thirteen months, 50 shares of Scripps Network (SNI) common stock in their account ending in t TD Ameritrade. The DTC clearinghouse number for TD Ameritrade is 0188.

If we can be of any further assistance, please let us know. Just log in to your account and go to the Message Center to write us. You can also call Client Services at 800-669-3900. We're available 24 hours a day, seven days a week.

Sincerely,

Chad Abal Senior Resource Specialist

·TO Ameritrade

This Information Is furnished as part of a general information service and TO Amariltade shall not be liable lor any damages arising out of any inaccuracy in the information. Because thi!;l information may diHer from your TO Ameritrade monlhfy statement, you should rely only on the TO Ameritrade monthly statement as the official rerord of your TO Amerilrade account.

Ma.J'ket volatility. volume, and system availability may delay account access and trade executions.

TD Ameritrade, Inc., member FINRA/SIPC/NFA ( www lima om, www 6ioc om, www nfa fuharas org ). TO Ameritrade is a trademark jointly owned by TO Ameritrade IP Company, Inc. and The Toronto-Oominion Bank. @2013 TD Ameritrs.da IP Company, Inc. All rights reset'Vad. used with permission.

~~00 S. J n~111 Ave, Ontal1a, NE u8E:•l

TOA 5380 L 09113

www.tdarnerittade.com






AMENDED AND RESTATED ARTICLES OF INCORPORATION OF

SCRIPPS NETWORKS INTERACTIVE, INC.

FOURTH: Classes and Number of Shares. The total number of shares of all classes of stock that the Corporation shall have authority to issue is 325,000,000 shares. The classes and the aggregate number of shares of stock of each class that the Corporation shall have authority to issue are as follows:

(i) 60,000,000 Common Voting Shares, $0.01 par value ("Common Voting Shares").

(ii) 240.000.000 Class A Common Shares, $0.01 par value ("Class A Common Shares" and together with Common Voting Shares, "Common Shares").

(iii) 25,000.000 Preferred Shares, $0.01 par value ("Preferred Shares").

A. Powers and Rights of Common Voting Shares and Class A Common Shares.

1. Election of Directors. Holders of Class A Common Shares, voting separately and as a class, shall be entitled to elect the greater of three or one-third (or the nearest smaller whole number if the aforesaid fraction is not a whole number) of the directors of the Corporation to be elected from time to time except directors, if any, to be elected by holders of Preferred Shares or any series thereof; and holders of Common Voting Shares, voting separately and as a class, shall be entitled to elect the balance of such directors.

2. Other Matters. Except as provided in this Article FOURTH with respect to Class A Common Shares or in any resolution providing for the issue of Preferred Shares or any series thereof, and as otherwise required by the Ohio Revised Code, the entire voting power shall be vested solely and exclusively in the holders of Common Voting Shares, the holders of Common Voting Shares to be entitled to one vote for each Common Voting Share held by them upon all matters requiring a vote of shareholders of the Corporation, and the holders of Preferred Shares or any series thereof or Class A Common Shares shall have no voting power and shall not have the right to participate in any meeting of shareholders or to have notice thereof. The number of authorized Class A Common Shares may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the outstanding Common Voting Shares.

Scripps Networks Interactive, Inc. 312 Walnut Street, 18'h Floor Cincinnati, OH 45202

Mary E. Talbott Senior Vice President, Deputy General Counsel and Corporate Secretary

0 scripps networks interactive

VIA CERTIFIED MAIL RETURN RECEIPT REQUESTED

January 2, 2015

James McRitchie Myra K. Young

PHONE (513) 824-3251 FAX (513) 824-3393 E-MAIL [email protected]

RE: Shareholder Proposal for Scripps Networks Interactive, Inc. (the "Company") 2015 Annual Meeting

Dear Mr. McRitchie and Ms. Young:

This letter acknowledges that on December 2, 2014 we received by facsimile your letter addressed to Cynthia L. Gibson, as Corporate Secretary for the Company, by which you submitted a shareholder proposal for inclusion in the Company's 2015 proxy statement pursuant to Rule 14a-8 under the Securities Exchange Act of 1934. The shareholder proposal requested that our Board of Directors "initiate the appropriate process to amend our Company's articles of incorporation and/or bylaws to provide that director nominees shall be elected by the affirmative vote of the majority of votes cast at an annual meeting of shareholders, with a plurality vote standard retained for contested director elections, that is, when the number of director nominees exceeds the number of board seats" (the "Proposed Resolution"). Although no evidence of ownership of any of our stock was included with your initial submission, on December 17, 2014 you submitted via facsimile a letter from Ameritrade indicating that you had continuously held 50 of our Class A Common Shares for at least thirteen months prior to the letter.

As you no doubt are aware, to be eligible to have the Proposed Resolution included in the Company's proxy statement, you must demonstrate that you meet the stock ownership requirements of Rule 14a-8(b). This letter is to inform you that you do not satisfy the ownership requirements to submit the Proposed Resolution. Rule 14a-8(b) requires a shareholder seeking to submit a shareholder proposal to have continuously held at least $2,000 in market value or 1% of the Company's outstanding shares entitled to vote on the proposed shareholder proposal at the annual meeting for at least one year by the date the shareholder submitted the shareholder proposal.

Pursuant to Article Fourth of the Company's Amended and Restated Articles oflncorporation ("Articles"), holders of the Company's publicly traded Class A Common Shares are entitled to elect the greater of three or one-third of the directors of the Company to be elected from time to time. Except for those specific voting rights, however, the Articles provide that the holders of Class A Common Shares "shall have no voting power and shall not have the right to participate in any meeting of shareholders or to have notice thereof" For your reference, I have attached to this letter the relevant portions of Article Fourth of the Articles.

Since the Proposed Resolution is not an issue on which the holders of our Class A Common Shares are entitled to vote under the Articles, as a holder of Class A Common Shares you are not eligible to vote on the Proposed Resolution and do not have the right to submit the proposal under Rule 14a-8. Further, because our Common Voting Shares (the only class of shares entitled under the Articles to vote on the


Proposed Resolution) are not publicly traded and are not available for purchase, there is no means by which you can remedy the ownership issue.

Please note that, pursuant to Rule 14a-8(f)(l ), if you submit a response to this letter, your response must be postmarked, or transmitted electronically, no later than 14 calendar days from the date you receive this notice. Please direct your correspondence to me at the above address.

Very truly yours,

Mary E. Talbott

Enclosures

AMENDED AND RESTATED ARTICLES OF INCORPORATION OF

SCRIPPS NETWORKS INTERACTIVE, INC.

FOURTH: Classes and Number of Shares. The total number of shares of all classes of stock that the Corporation shall have authority to issue is 325,000,000 shares. The classes and the aggregate number of shares of stock of each class that the Corporation shall have authority to issue are as follows:

(i) 60,000,000 Common Voting Shares, $0.01 par value ("Common Voting Shares").

(ii) 240,000,000 Class A Common Shares, $0.01 par value ("Class A Common Shares" and together with Common Voting Shares, "Common Shares").

(iii) 25,000,000 Preferred Shares, $0.01 par value ("Preferred Shares").

A. Powers and Rights of Common Voting Shares and Class A Common Shares.

1. Election ofDirectors. Holders of Class A Common Shares, voting separately and as a class, shall be entitled to elect the greater of three or one-third (or the nearest smaller whole number if the aforesaid fraction is not a whole number) of the directors of the Corporation to be elected from time to time except directors, if any, to be elected by holders ofPreferred Shares or any series thereof; and holders of Common Voting Shares, voting separately and as a class, shall be entitled to elect the balance of such directors.

2. Other Matters. Except as provided in this Article FOURTH with respect to Class A Common Shares or in any resolution providing for the issue of Preferred Shares or any series thereof, and as otherwise required by the Ohio Revised Code, the entire voting power shall be vested solely and exclusively in the holders of Common Voting Shares, the holders of Common Voting Shares to be entitled to one vote for each Common Voting Share held by them upon all matters requiring a vote of shareholders of the Corporation, and the holders of Preferred Shares or any series thereof or Class A Common Shares shall have no voting power and shall not have the right to participate in any meeting of shareholders or to have notice thereof. The number of authorized Class A Common Shares may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the outstanding Common Voting Shares.

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